Ripple: XRP price reaches an important resistance level

Ripple: XRP Price Hits Major Resistance Level - AOCXEN5XKNN5LNIEFQDEO66GMYFebruary was a tumultuous month for most major cryptocurrencies in terms of prices. However, some of them have managed to escape the high volatility affecting the sector.

Ripple (quotation XRP) is one such cryptocurrency. Indeed, the token recorded a relatively stable performance in February. However, its performance is declining as March approaches, raising serious concerns among investors.

Falling demand for Ripple

Like most cryptocurrencies, the XRP token saw a dramatic increase in early January. Conversely, a study of blockchain data shows a slight divergence between XRP's price action and its network growth.

Cryptocurrencies are based on blockchain, so the growth of a network becomes a fundamental measure that can support the long-term viability of a given ecosystem. Thanks to this data, it is possible to analyze the net increase in the number of participants joining a blockchain network over a given period.

For example, the analysis report reveals that the growth of the XRP network is very different from the prices XRP experienced during its recent growth in January 2023.

According to statistics, the price of the token was initially $0,34 on Jan. 2 and peaked at $0,42 on Jan. 23, an increase of 24%. At the same time and over the same period, its network growth declined by 27%.

For analysts, such a divergence in performance suggests that the price increase is the result of mere speculation and not new investor demand.

The situation is likely to become even more complex, as between February 1 and March 5, there was a further 37% drop in network growth.

The XRP token follows the movements of the November 2021 crash

In addition to the decline in the growth of its blockchain, Ripple also has to deal with its price, whose volatility is steadily decreasing. According to trading data recorded on its blockchain, the price volatility of XRP is decreasing. It is reportedly reaching the levels recorded during the infamous cryptocurrency crash of November 2021.

This is an important issue, as in most cases, it is volatile assets that are in high demand among cryptocurrency investors. They usually move faster and have bigger price swings.

As the XRP token appears to be holding its price level stagnant, analysts believe some impatient investors may start selling their tokens. Many XRP holders are therefore preparing for a potential price drop in the coming days.

Ripple (XRP) faces a formidable resistance zone in March 2023

An estimate of the potential price action of XRP can be obtained based on a study by Santiment. While its price has currently reached $0,36, most investors who chose to buy XRP over the past 30 days have suffered a loss of around 3%.

The price of the token is very likely to drop towards $0,30 in the coming days. Furthermore, if it does not rebound in this area, the decline could continue to bring the token to $0,25.

On the other hand, if the XRP token manages to clear the $0,40 area, it could embark on a big rally that will push it towards $0,46.

Therefore, the current resistance at $0,40 looks like a major hurdle for XRP. Market shifts, both good and bad, or the end of Ripple's SEC lawsuit could tip the balance one way or the other for this asset.

Therefore, if the cryptocurrency is stagnating before a possible rally, it is an ideal time to buy XRP in order to make significant profits, especially if the lawsuit with the SEC offers a victory for Ripple.